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Impairment, Restructuring and Other Charges

3 Months Ended

Sep. 30, 2020

Impairment, Restructuring and Other Charges

Impairment, Restructuring and Other Charges

7. Impairment, Restructuring and Other Charges

We endeavor to align our global capacity and infrastructure with demand by our customers as well as fully integrate acquisitions and thereby improve operational efficiency.

During the quarter ended September 30, 2019, we recognized a net benefit of $2.1 million primarily related to reimbursements from our insurance carriers for covered legal charges, partially offset by additional legal fees related to class action litigation and government investigations.

During the three months ended September 30, 2020, we commenced exit activities associated with an expired turnkey contract in Mexico whereby we incurred non-recurring charges totaling $6.9 million comprised of exit costs of $2.5 million for employee terminations, facility closure and other exit costs of $1.1 million, direct transaction costs of $2.7 million and impairment of a right-of-use asset of $0.6 million. We also conducted other operational efficiency activites which resulted in employee termination costs of $1.4 million and other costs of $0.1 million. The following tables summarize impairment, restructuring and other charges (benefit), net for the periods set forth below (in thousands):


	Three Months Ended September 30, 2019
					Optoelectronics and
			Healthcare		Manufacturing
	Security Division		Division		Division		Corporate		Total
Employee termination costs (benefit)	$	—	$	—	$	(13)	$	71	$	58
Legal recoveries, net		—		—		—		(2,157)		(2,157)
	$	—	$	—	$	(13)	$	(2,086)	$	(2,099)


	Three Months Ended September 30, 2020
					Optoelectronics and
			Healthcare		Manufacturing
	Security Division		Division		Division		Corporate		Total
Impairment charges	$	552	$	—	$	—	$	—	$	552
Employee termination costs		3,737		—		146		—		3,883
Mexico transaction costs		2,692		—		—		—		2,692
Facility closures/consolidation		1,272		—		—		—		1,272
Legal recoveries, net		—		—		—		(40)		(40)
Total expensed	$	8,253	$	—	$	146	$	(40)	$	8,359

The changes in the accrued liability for restructuring and other charges for the three-month period ended September 30, 2020 were as follows (in thousands):



			Facility
	Employee		Closure/
	Termination		Consolidation		Legal Costs and
	Costs		Cost		Settlements		Total
Balance as of June 30, 2020	$	545	$	201	$	1,882	$	2,628
Restructuring and other charges (benefit), net		3,883		1,272		(40)		5,115
Payments, adjustments and reimbursements, net		(4,128)		(1,473)		(3)		(5,604)
Balance as of September 30, 2020	$	300	$	—	$	1,839	$	2,139